New Delhi, Nov. 21 -- A former executive at Canadian pension fund Caisse de depot et placement du Quebec (CDPQ) has been indicted along with Indian billionaire Gautam Adani and other senior officials at the Adani Group, by the US prosecutors, for their alleged role in what may have been a case of multi-billion-dollar bribery and fraud.

Cyril Cabanes, a former managing director of infrastructure for Asia-Pacific at CDPQ has been named alongside Gautam Adani, his nephew Sagar Adani and Vineet Jaain for allegedly agreeing between 2020 and 2024 to pay $250 million (over Rs 2,100 crore) in bribes to officials in India, to win solar energy supply contracts at above market rates, that could yield profits of the order of $2 billion.

Cabanes had left CDPQ in January this year and is now the chief executive officer at MorGen Energy, according to his LinkedIn profile.

CDPQ is the majority owner of India-based green energy firm Azure Power that was earlier listed on the New York Stock Exchange (NYSE) but has since been delisted from the bourse.

Cabanes, who was on the board of directors at Azure Power, has been charged with Foreign Corrupt Practices Act (FCPA) violations for his role in the alleged bribery scheme.

Cabanes allegedly facilitated the authorization of bribes in furtherance of the scheme while in the US and abroad, as per a complaint by the US Securities and Exchange Commission.

"According to the SEC's allegations, the bribery scheme was orchestrated to enable the two renewable energy companies to capitalise on a multi-billion-dollar solar energy project that the companies had been awarded by the Indian government. During the alleged scheme, Adani Green raised more than $175 million from US investors and Azure Power's stock was traded on the New York Stock Exchange," the SEC statement

Apart from this, the Adani Group's green energy company is also alleged to have raised bonds and loans worth more than $3 billion allegedly based on false and misleading statements, reports said.

While Gautam Adani heads the Adani Group, his nephew is an executive director on Adani Green's board.

The SEC complaint says that the Adanis paid or promised to pay hundreds of millions of dollars in bribes to government officials in India to get their commitment on purchasing energy at above market rates, which would directly benefit Adani Green and Azure Power.

The allegations say that the Adanis were engaged in the bribery scheme during a 2021 offering by Adani Green that raised $750 million, of which $175 million was raised from US investors. "The Adani Green offering materials included statements about its anti-corruption and anti-bribery efforts that were materially false or misleading in light of Gautam and Sagar Adani's conduct," the SEC said in its statement.

The SEC's division of enforcement, which is headed by an Indian origin official Sanjay Wadhwa, has alleged that the Adanis induced investors in the US to purchase bonds of Adani Green via an offering that not only allegedly misrepresented that Adani Green had an anti-bribery compliance programme but also that the senior management would not indulge in bribery. Cabanes is alleged to have participated in the bribery scheme while serving as director at Azure, which was then publicly-listed on the NYSE.

The SEC's complaint against Gautam and Sagar Adani charges them with violating the antifraud provisions of the federal securities laws. The complaint seeks permanent injunctions, civil penalties, and officer and director bars. The SEC's complaint against Cabanes charges him with violating the FCPA and seeks a permanent injunction, a civil penalty, and an officer and director bar. Both complaints were filed in the US District Court for the Eastern District of New York.

Most Adani Group stocks were down over 10% on Indian stock exchanges in Thursday morning trade, following these allegations.

Published by HT Digital Content Services with permission from VC Circle.